Addressing the situation caused by Covid-19
With an annual average GDP growth of 5.3% over the last 15 years, Peru has had one of the most dynamic economies in the region. However, the country is seriously affected by the Covid-19 crisis from both a health and economic perspective. In terms of health, Peru is the third most affected country in Latin America, behind Brazil and Mexico. On the economic front, the country is expected to experience a deep recession in 2020. Peru is one of the Latin American countries to have provided the swiftest response to the Covid-19 crisis.
The public authorities have identified banks as the main channel to support the economy. They have a key role to play in the current situation: rescheduling of bank loans, new loans granted and their role as managers for the payment of allowances to people who benefit from the Government’s support programs.
Supporting Banbif and its lending activities to the SME segment
BanBif and PROPARCO have been partners since 2010 and this credit line is the third joint operation. The bank was set up in 1991 and initially focused on large companies before extending its range of loans to SMEs and individuals. BanBif is the fifth largest bank in Peru by the size of its balance sheet.
Through this USD 50m loan, PROPARCO is reiterating its support to one of its main Peruvian banking partners, in the context of the Covid-19 crisis which has severely affected the country. This credit line will allow BanBif to strengthen its liquidity position, if needed, and to continue supporting its corporate clients with a view to recovery from the crisis.
Through these various expected impacts on development, the project will contribute to SDG 8 (Decent work and economic growth)